Sympathy Dissipated

The banks are again taking their lumps, most recently for the delays in granting relief to borrowers on the brink of foreclosure. In the public mind the banks still haven't received punishment for the past decade's relentless pursuit of "flip" profits on risky financial deals, then leaving taxpayers to hold the bag when the losses proved too much for them to absorb. The payouts of big bonuses to people who caused the mess poured salt in the public's wounds.

In the current environment it's very tough to manage a bank: they have been directed to lessen the risky assets that they are holding and make more loans---contradictory actions that are like stepping on the gas and the brakes at the same time. Nevertheless, their incessant search for fees from everyone, even in areas totally removed from mortgage lending, immediately dissipates any sympathy.

In 2012 I enrolled in a high-deductible health plan and opened a Health Savings Account to pay the HDHP's out-of-pocket expenses. (HSAs have a number of advantages, principally tax-deductible contributions and tax-deferred earnings.) I opened the HSA at the Bank of America and tried to write a $3,000 check from one of my two Bank of America checking accounts to fund the account. I wanted to pay for some prescriptions from the HSA and couldn't imagine that there would be a problem, since we have had loans and accounts with B of A since the 1980's.

The alarm bell should have gone off when the local branch said that they could not handle what appeared to be a simple transfer. A couple of phone calls later, I found that I was able to make the transfer online. The funds were immediately debited from my checking account:

The $3,000 was removed from the account on a Monday

By the third day the funds still had not appeared in the HSA:

As of Wednesday night the $3,000 had not appeared.

The Customer Service person said that the transfer would take five to seven business days because it "had to go through the Federal Reserve". There is no good conclusion that one can reach from this explanation. Either: 1) the Bank had instructed its CSR's to give an explanation that was patently false, or 2) a small $ transfer between accounts in the same bank does have to be handled by the Federal Reserve, which could be one reason why the banking system is messed up. I am inclined towards (1), which means I'll be looking for a new HSA bank next year.

Oh, yes, the $ did appear in day 4, I did refill my prescriptions, and the bank promptly deducted its $4.50 monthly fee last week.

Icons

We know that we are getting on in years when the icons of our adulthood pass away, and they're younger than we are.

Whitney Houston not only had the voice of an angel; she controlled it as magnificently as Da Vinci wielded a paint brush. She could hold a note perfectly and unwaveringly, or let it skip up and down the scale, keeping it separate from the accompaniment until the end when they all landed together in major triumph. And she was beautiful, too, as beautiful as Taylor Swift is today, but her voice was much stronger and clearer than Taylor's. When Whitney Houston was at the height of her powers she succumbed to human weakness and was hurt by those who should have helped her. Her death on Saturday, after a long decline, was not shocking, but the event does throw cold water on our belief (hope) that it's never too late to correct our mistakes or improve our lives.

Freddie Solomon, who played on two of the 49er Super Bowl teams, died of cancer today. Freddie Solomon was the "speed" wide receiver that was essential to the operation of the Bill Walsh offense, which spread passes around to tight ends, running backs, and "possession" wide receivers like Dwight Clark. Freddie tutored Jerry Rice though he knew Jerry would take his job. A relaxing retirement was not for Freddie.

After his playing days, he devoted himself to community service in Tampa. He worked with youths for 20 years through a program with the Hillsborough County Sheriff’s Office. He also teamed with former 49ers owner Eddie DeBartolo, a Tampa resident and close friend, on an annual Christmas celebration for foster children.

Freddie Solomon did not receive the awards given to his more famous teammates, but in character and generosity he was among the greatest of 49ers.

Transfiguration Episcopal Church

Transfiguration Episcopal Church has reconstructed its worship space to be more open and let in more light, worthy objectives for a church even when the subject is not buildings-and-grounds [that's how we designate property, plant, and equipment in the church world].

The moveable pews can easily be re-arranged to accommodate traditional and informal liturgies. The hardwood floors and variable lighting capability add to the ambience.

The stained glass windows extend nearly to the floor, where comfortable cushions invite the visitor to kneel and contemplate (or, in my case, sit and gather wool---sigh, google the idiom yourself).

Like many other Episcopal churches, Transfiguration was built many years ago on property that would be prohibitively expensive to acquire today. The reconstructed sanctuary sits on a hill on the mid-Peninsula. The parish is well situated to weather storms in the years ahead.

Lymphatic Malformation

From Johns Hopkins

(Good) Viagra news that won't be made into a joke:

In very early reports, sildenafil - best known under the brand name Viagra and sold as a treatment for erectile dysfunction - reduced the size of growths in three children with lymphatic malformation, a disease that causes spongy cysts to swell and clog up the lymphatic system.

Viagra was originally developed to treat high-blood pressure and became popular due to a beneficial side effect in males.

Plaudits to Stanford doctors  for discovering and now researching another side effect that could make a great difference in a few children's lives.

Not A Jeremy Lin Blog, But...

The Jeremy Lin story has gotten even bigger with the 38 points he scored in the Knicks' 92-85 win over the Lakers on Friday night in Madison Square Garden.

Sports experts would not have been surprised if the Lin express would have come to a screeching halt--or at least been slowed down a bit--when the Knicks played five-time world champ Kobe Bryant. Instead, Jeremy Lin scored the most points by a Knick this season and nailed baskets at critical junctures in the game.

Adding to the luster of his performance was the fact that the game was on national TV. In recent weeks we have seen instances of choking by young athletes when their big moment arrives. Jeremy Lin is grabbing opportunity by the neck and riding it to the moon.

[Update - 2/11: What do you expect from a Dragon? It's his (our) year!

“Of the twelve signs of the Chinese zodiac, the Dragon is the most special, as it is a mystical being rather than an earthly animal....In this context that means we can expect grand things this year. Bigger than life is very much a Dragon thing.”]

[Update - 2/12: He showed signs of exhaustion after a grueling five games in seven days, plus defenses that have learned to bang him harder as he drives inside, but Jeremy Lin again led the Knicks to victory in Minnesota last night:

Although Lin scored 20 points in the Knicks’ 100-98 victory over Minnesota for his fifth consecutive 20-point game, he struggled to do so. Lin, the newest Knicks sensation, shot 8 for 24 from the field, had six turnovers, and managed only 5 points in the second half.

But he still became the first player in N.B.A. history to post at least 20 points and 7 assists in his first four starts...]

Jeremy Lin

We remarked below how "unknown" point guard Jeremy Lin has risen to the top of the sports universe this week by leading the New York Knickerbockers to victories over the Jazz and the Nets. He did it again last night against the Washington Wizards:

Jeremy Lin, the undrafted Harvard economics graduate, has now played 111 meaningful minutes of NBA basketball since the weekend. He's scored a combined 76 points, become a national phenomenon, won three games and blown a few minds.

He is part Steve Nash, part Paul Bunyan and late Wednesday night, after the Knicks beat the Washington Wizards 107-93, Knicks coach Mike D'Antoni called him "for real." So stop rubbing your eyes—it's not a dream.

Three attributes widely regarded as positives in the rest of society--Harvard degree, Asian-American, 6'3" height--were obstacles to Jeremy Lin's acceptance by NBA teams; it is an understatement to say that expectations for him were low.

His underdog status, his performance on the biggest media stage during the quiet period between the Super Bowl and the NCAA tournament, his sincere understated Christianity, and his growing international (especially Asian) following make Jeremy Lin a public relations dream.

Go East, Young Man

Chico, California native Aaron Rodgers was a star quarterback for Cal-Berkeley, but the 49ers chose Alex Smith ahead of him. Aaron Rodgers went to Green Bay and became the NFL and Super Bowl MVP.

San Mateo-born Tom Brady led the New England Patriots to the Super Bowl five times (won 3, lost 2) and has been named the league- and Super-Bowl MVP on multiple occasions.

Vallejo High graduate CC Sabathia won the Cy Young award and signed a seven-year $161 million contract with the New York Yankees in 2009. That is the largest contract ever granted to a pitcher.

The latest successful Northern California export is Jeremy Lin, who played basketball at Palo Alto High. Stanford didn't try to recruit him, and Jeremy became an economics major at Harvard, where he was an all-Ivy basketballer in his junior and senior years. Undrafted by the NBA, he played occasionally in 2010 for the Golden State Warriors, who waived him in 2011. When the New York Knicks' starting guards couldn't play because of injury and family tragedy, Jeremy led the Knicks to victory over the Nets and Jazz. Two games do not a season or career make, but the signs are promising.

Mark 6:3-4 "Isn't this the carpenter? Isn't this Mary's son and the brother of James, Joseph, Judas and Simon? Aren't his sisters here with us?" And they took offense at him. Jesus said to them, "Only in his hometown, among his relatives and in his own house is a prophet without honor."

Great Moments in Intellectual Property

What they said at the 1983 meeting between Steve Jobs and Bill Gates, when Microsoft announced plans for the graphical interface "Windows":

Jobs: "You're ripping us off! I trusted you, and now you're stealing from us!"

Gates: "Well, Steve, I think there's more than one way of looking at it. I think it's more like we both had this rich neighbor named Xerox and I broke into his house to steal the TV set and found out that you had already stolen it."

--From Steve Jobs, by Walter Isaacson

A Reason to Be Glad the Patriots Lost

Extra reporter and Patriots fan Maria Menounos paid off her Super Bowl bet by appearing in a bikini on national TV. I had a slight rooting interest because of Bay Area native Tom Brady. Any disappointment from a Patriots loss has now been dispelled.

Super Bowl XLVI - The Best Ever

...production. The commercials and the half-time show reflect the expenditure of many millions of dollars. Madonna's production was visually extravagant, aurally pleasing but not chills-down-your-spine memorable. Some of the commercials - Matthew Broderick's spoof of his Ferris Bueller role, "king" Elton John's Pepsi commercial--are outstanding.

9:25 ET - As for the game, currently Patriots 17, Giants 15, with eight minutes remaining, it's feeling like it could have one of the all-time great endings. With one probable Hall-of-Fame quarterback facing a possible Hall-of-Fame opponent, all the ingredients are there for a wow finish.

9:32 ET - Patriots with a two-point lead are in the midst of a clock-killing drive. Tom Brady misses a wide-open Wes Welker, then another open receiver. Punt. 3:46 left. Giants start on their own 12. Here we go.

9:37 ET - Outstanding catch by Manningham along the sidelines. Giants now at midfield. Field goal will put the Giants ahead by one. Another pass to Manningham. Giants are within field goal range on the NE 35 with 2:30 left.

9:40 ET - Pass to Nicks on the NE 18-yard-line. Two minute warning! Not quite the same situation as NFC championship, when Giants automatically won on a short field goal. They want to score but not leave Patriots enough time to come back.

9:46 ET - Something I've never seen in a Super Bowl, not even in an NFL game. Patriots let Giants run through the line, and running back Bradshaw attempted to stop at the goal line but fell through for a touchdown that he didn't want to score! Patriots need to score TD and have a minute to do it.

9:51 ET - Giants 21, Patriots 17. Brady sacked! 40 seconds left. 4th and 16 for the Patriots. They have no chance!

9:53 ET- Pass to Branch for the first down! NINE seconds left.

9:55 ET - One play left. Hail Mary coming.

9:56 ET - Ball tipped interminably in end zone. Ball on ground! Giants! Guess the Patriots did have a snowball's chance. Whew.

Adobe Animal Hospital

It's early morning on Super Bowl Sunday. Customers stream through the double doors at Adobe Animal Hospital . Many of them don't want to be here and howl their objections.

The emergency room is open 24/7. However, if the customer is not a dog or cat, the staff may not be able to take her immediately; "exotic" specialists aren't always present. Our guinea pig was sick last night, but we couldn't bring her in until today. Turtles, birds, fish and guinea pigs are second-class citizens in a canine- and feline-dominated world.

Our animal's breathing has improved greatly. The doctor prescribed Baytril prophylactically. We are aware of the dangers of over-administering antibiotics, but guinea pigs are sensitive creatures who can go downhill quickly. At the margin, we'll opt for the medicine.

We were done after 90 minutes---a minor digression from the day's plans, and an excellent result when one considers everything that could have gone wrong.

Go Patriots, go Giants Oh, heck, I just hope it's a well-played, competitive game.

If You Won't Do It For Yourself...

"Senior-move management" and estate liquidation: businesses that have prospered in response to a growing need.

As older parents approach death, they often leave lengthy to-do lists for their children. The tasks can be both physical and financial. Some children must deal with a tangle of arrangements—everything from heating-oil contracts to trusts—along with jumbled stock certificates, car titles or life-insurance policies for which there may be no backup copies. Others must sift through boxes or rooms full of belongings.

One of the best gifts that parents can leave their children is an organized life. Harried heirs often must sort through decades of memories and clutter, clueless about items' significance. Of course, it's better to communicate the details of one's estate while one is alive, but that's a difficult conversation that understandably keeps getting postponed.

It seems that the purpose of life is to accumulate stuff through middle age, then spend the remainder of one's years getting rid of most of it, then organizing what's left.

Stand and Palaver

The latest trend in company meetings---standing:

The object is to eliminate long-winded confabs where participants pontificate, play Angry Birds on their cellphones or tune out.

Shorter meetings don't cause the quality of the output to suffer:

a study back in 1998 that found that standing meetings were about a third shorter than sitting meetings and the quality of decision-making was about the same.

Not only does productivity rise from spending less time in meetings, but standing up also confers health benefits.

Just think of the non-business activities that can benefit from the standing principle: 1) church services would be a lot shorter if worshippers had to stand throughout; 2) lines at the DMV, Post Office, and train station would move faster if the clerks were made to stand like the suffering customers; 3) professors will make their points more quickly and students will pay more attention if they had to stand for lectures.

The mind boggles at the possibilities.
© 2012 Stephen Yuen

Facebook Palooza

Facebook's income: 2009 - 2011

It's Facebook Palooza at the Wall Street Journal, where there are over a dozen articles and blog posts about Facebook's S-3 filing for the IPO.

There's a lot to mull over, but I've already concluded that I won't be buying the stock when it becomes available. (Here's why you should not listen to me: I could have bought Google on the day after its initial public offering for $100 but didn't get in till GOOG surpassed $400. Still here? Okay, you were warned.)

There's no question that Facebook's revenues and earnings will rocket upward....for a while. Let's say that FB's 2011 net income of $1 billion rises to $10 billion in 2015 (for example, doubling for three years running, then tapering to "mere" 25% growth in year four). Applying a price-earnings ratio of 20--the same as Google's current trailing twelve-month multiple--results in a 2015 company valuation of $200 billion, a doubling of today's $100 billion IPO value.

Such price appreciation (19% compounded annual growth rate) would be very good, to be sure, but it also may be achievable without taking the risk of investing in an IPO. Stocks with a much longer track record, such as my January 7, 2012 portfolio, are already up 19% for the year.

The WSJ compares Facebook with Google:

                          Google          Facebook
2011 Revenue             $37.9 billion   $3.7 billion
Growth rate from 2010     29%             88%
2011 Income              $9.74 billion   $1 billion
Growth rate from 2010     15%             65%
Employees                 32,467          3,200

Google triumphed by defeating competitors like Yahoo. Facebook has a tougher challenge because it has Google in its way. Other risks (slower customer growth, loss of key employees, etc.) listed in the S-3 are those which one might expect.

[Update: although Mark Zuckerberg owns "only" 28% of Facebook, he controls it through the tiered share structure and agreements with other large shareholders. If you invest in Facebook, you'll be stuck with Mark, for better or worse, in sickness or in health.]

But let's not get too negative: there's a reasonable chance that I'll have regrets for not investing in Facebook, but it's hoped that the performance of my other investments will ease the pain.

[Update - 2/4: A WSJ analyst isn't impressed with Facebook's potential upside.

If Facebook's shares rose from a total initial value of $100 billion to $190 billion 10 years from now, they would deliver a 90% cumulative gain, for an average annual return of 6.8%. Bottom line: "The valuation is so high today that the upside potential is limited," (Finance prof Jay) Ritter says.]

© 2012 Stephen Yuen

Rabbit, Rabbit Reprise

Only a few word changes are necessary to update the post from one year ago:

I remembered the only thing that my 11th-grade math teacher taught me and said “Rabbit, Rabbit” when I rolled out of bed this morning.

a person should say "rabbit, rabbit, white rabbit", "rabbit, rabbit, rabbit", "rabbit, rabbit" or simply "white rabbits" upon waking on the first day of each new month, and on doing so will receive good luck for the duration of that month.

The lucky Year of the Rabbit Dragon commences on Thursday d on January 23rd, which should double the good luck. Time to throw caution to the winds and buy some stocks that I’ve been eyeing. Already the market has had its best January in 14 15 years, and I'm thinking (hoping) that it’s got more room to run.

Well, you know what they say about a fool and his money…..

January was good last year, but this year it's been outstanding, especially the NASDAQ (in red):

[Update - 2/2: January's Stock Performance is the Best in 15 Years. ]

January 1 -31,  2012

January 1 - 31, 2011